Do you need a structural warranty when building, converting or extending a property?

You’re building a new home, there’s a lot to think about from getting planning approval, hiring an architect to what materials to use. One of the things that may get forgotten until the last minute, but is equally as important, is a structural warranty.

There is often confusion surrounding warranties, building control and other insurances making it difficult to know what is needed and when.

We have outlined what a warranty is and what protection you need for your build.

What is a structural warranty?

A structural warranty is an insurance policy designed to protect against defects in new buildings, normally for a period of 10 years after completion.

Whilst a structural warranty is purchased by the builder before construction starts, it actually protects the homeowner from structural damage that may occur during the first ten years after it has been completed.

What does it cover?

The cover provided by a structural warranty varies greatly by provider but can include:

Deposit protection – should the developer become insolvent during the build this protects the homeowner’s deposit

Defects insurance – leading providers of structural warranties include a defects period for the first two years of cover. This provides protection against non-compliance with the warranty provider’s technical manual and may include non-structural issues.

Structural insurance – this makes up the main part of the warranty and covers against structural issues after the defects period expires.

Contaminated land – protects against the cost of removing contamination from the housing plot

Building Control cover - if elements of the house were not built in compliance with Building Regulations and are a hazard to the health of residents this can cover the costs to put things right

When is a warranty required?

If you are building or converting new homes it is recommended you purchase a structural warranty prior to construction, in addition to building regulation approval.

However, if you are building a conservatory or an extension you may not need a warranty but you will need to comply with building regulations to ensure the property is structurally sound.

Find out more about how to obtain building regulation approval for your project.

Why do you need a warranty?

A structural warranty may not be top of your priority list, especially when other costs are already starting to mount up.

However it is worth looking at the different options available to you, as even the best builders cannot completely guarantee there will be no issues with their work or with the materials used. A structural warranty would provide protection against defects in either workmanship or the risk of failure with construction materials.

The main reason you will need to invest in a structural warranty is to help you sell your property once it is completed. The vast majority of mortgage lenders and banks require a structural warranty to be in place before they will provide a mortgage on a property.

With an LABC Warranty you will also benefit from useful technical guidance throughout your build to help you limit the potential for any problems and ensure your reputation is protected.

How do you choose the right warranty?

Gone are the days were there was only one provider of structural warranties. There are now several warranties on the market, which can make it difficult to work out which one has the best cover to suit you. The Council of Mortgage Lenders (CML) have released some guidelines to help you understand what to consider in terms of type of cover, inspection regimes and lender acceptance.

Warranties can also be confused with other types of insurance including site insurance and household insurance. To understand the differences and what insurance is needed and when read our blog on Construction Insurance.